The Wonk Room

Cadre Of Senators Bail Out The Financial System, Leave Auto Industry Out To Dry

Our guest blogger is Daniel J. Weiss, a Senior Fellow and the Director of Climate Strategy at the Center for American Progress Action Fund.

Last night a cadre of Senators drove General Motors and Chrysler to the brink of bankruptcy by voting against a $14 billion program to provide bridge loans to the auto companies. The loans have already been agreed to by President Bush and the House of Representatives.

Sixty votes were required to end a filibuster of the bill before final passage, and the vote was 52-35. A batch of conservatives, led by Senator Bob Corker (R-TN), objected to it because they wanted to squeeze even more wage and benefit cuts from factory workers who belong to the United Auto Workers.

The $700 billion Emergency Economic Stabilization and Recovery Act — which created the TARP — passed in October, and included fewer strings and employee wage and benefit cuts than the auto loan package. Yet, there were 20 senators who voted in favor of rescuing the financial system, while voting against extending a $14 billion loan to the automakers. Ten others voted yes to the former and did not cast any vote last night.

These lawmakers were willing to write a huge blank check to Wall Street that gave AIG $123 billion, Citigroup $25 billion, and JP Morgan $25 billion, yet left America’s domestic auto industry out to dry. Had eight of these 20 voted for the White House proposal, the auto companies would avoid catastrophe this year:

Yes to TARP, No to auto

Yes to TARP, Absent for auto

Sen. Max Baucus (D-MT) Sen. Robert Bennett (R-UT) Sen. Richard Burr (R-NC) Sen. Saxby Chambliss (R-GA) Sen. Tom Coburn (R-OK) Sen. Norm Coleman (R-MN) Sen. Bob Corker (R-TN) Sen. John Ensign (R-NV) Sen. Chuck Grassley (R-IA) Sen. Judd Gregg (R-NH) Sen. Orrin Hatch (R-UT) Sen. Kay Hutchison (R-TX) Sen. John Isakson (R-GA) Sen. Jon Kyl (R-AZ) Sen. Blanche Lincoln (D-AR) Sen. Mel Martinez (R-FL) Sen. John McCain (R-AZ) Sen. Mitch McConnell (R-KY) Sen. Lisa Murkowski (R-AK) Sen. John Thune (R-SD)

Sen. Lamar Alexander (R-TN) Sen. Joe Biden (D-DE) Sen. John Cornyn (R-TX) Sen. Larry Craig (R-ID) Sen. Lindsey Graham (R-SC) Sen. Chuck Hagel (R-NE) Sen. John Kerry (D-MA) Sen. Gordon Smith (R-OR) Sen.Ted Stevens (R-AK) Sen. John Sununu (R-NH)

Some of the those who were absent for the vote had understandable reasons, of course. Kerry was in Poznan, Poland, representing the United States at United Nations climate change talks, while Biden was attending to transition duties and Alexander was home recovering from surgery.

In any case, hopefully President Bush will loan money from the Troubled Assets Relief Program to ensure that GM and Chrysler avoid bankruptcy for the next several months, thus enabling them to restructure, recover, and thrive by building the super fuel efficient cars of the future.